Ovintiv Inc. (de) · NYSE:OVV
Ovintiv Inc. (de) — Merger or Acquisition (November 2024)
26 slides from Ovintiv Inc. (de)'s merger presentation, Nov 14, 2024
Slide 1: Permian & Montney Oil Powerhouse
Permian & Montney Oil Powerhouse November 14, 2024 Exhibit 99.2
Slide 2: Cautionary Statements
Cautionary Statements For convenience, references in this presentation to “Ovintiv”, “OVV”, the “Company”, “we”, “us” and “our” may, where applicable, refer only to or include any relevant direct and indirect subsidiary entities and partnerships (“Subsidiaries”) of Ovintiv Inc., and the assets, acti
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exc
Slide 4: High-Grading The Portfolio
High-Grading The Portfolio Acquiring Core Montney oil ~80% undeveloped acreage in high-return oil window For $2.377 B1 Divesting Uinta For $2.00 B A Permian & Montney Oil Powerhouse Note: throughout this presentation, “oil” when referring to Montney oil includes both oil & condensate given the near-
Slide 5: Focused in the Top North American Oil Basins
Remaining Undrilled Resource (Ovintiv Internal North American Resource Assessment) Undeveloped Bbbls ~80% of remaining sub-$50/bbl breakeven oil locations in North America are in the Permian & Montney (Enverus, PV10 breakeven at 20:1 conversion) Focused in the Top North American Oil Basins The Permi
Slide 6: Advancing Our Durable Returns Strategy
Advancing Our Durable Returns Strategy Ŧ Non-GAAP measures defined in advisories. For additional information please see advisories contained within this document. 1) Pro-forma estimates and per share metric increases are for FY25E and assume both the acquisition and disposition close January 1, 2025
Slide 7: Acquired Montney Asset Overview
Asset Profile 70 MBOE/d expected at close1 25 Mbbls/d oil & condensate1, 230 MMcf/d natural gas1 Anticipate load-leveled pro forma activity of 3 rigs & 1 frac crew Inventory & Operational Details 109k contiguous net acres proximate to existing Pipestone position ~80% undeveloped ~900 net 10k locatio
Slide 8: Conservative Transaction Funding
Conservative Transaction Funding Expect agencies to reaffirm investment grade ratings & stable outlooks Committed to maintaining IG rating $4.0B debt target reaffirmed Temporary buyback pause funds net cash requirement of $377 MM Pause began with 3Q24 Free Cash FlowŦ that would have been used for re
Slide 9: Immediately & Long-Term Accretive
Immediately & Long-Term Accretive Accretive on all key financial metrics including Cash FlowŦ & Free Cash FlowŦ ~$300 MM higher Free Cash FlowŦ in FY25E1 ~$200 MM more Cash Flow,Ŧ ~$100 MM less capital Additional Free Cash FlowŦ supports higher shareholder returns, debt paydown acceleration & lower
Slide 10: Acquiring the Best Rock in the Montney
Acquiring the Best Rock in the Montney 1) Enverus. Horizontal wells online since ’22 with 10%+ liquids. Alberta Montney peers include AAV, ARX, BIR, CNQ, KEL, NVA, SCR, VRN & WCP. 2) Premium reflects >35% IRR at $55/bbl WTI oil and $2.75/MMBtu NYMEX. 3) Enverus. Horizontal wells online since ’22 wit
Slide 11: Enhancing Our Montney Oil Position
~600 Premium Locations1 12-16 WPS, two benches across position + 3rd bench in highest oil-in-place acreage ~300 Upside Locations1 3rd bench across position & add’l infill opportunities Enhancing Our Montney Oil Position 1) Premium reflects >35% IRR at $55/bbl WTI oil and $2.75/MMBtu NYMEX. Locations
Slide 12: Ovintiv is the Best-in-Class Montney Operator
OVV Spud-Rig Release vs. Peers2 Ovintiv is the Best-in-Class Montney Operator 1) OVV capital efficiency reflects FY24E Montney capex guidance and 2Q24 Montney production. Peer capital efficiency reflects FY24 total company capex guidance converted to USD at 0.75 CAD/US FX and total company 2Q24 prod
Slide 13: Speed Driving Montney Efficiencies
Speed Driving Montney Efficiencies Drilled Ft/Day Completed Ft/Day <$500/ft Pacesetter D&C $525-$575/ft FY24 D&C Guidance ~1,700 ~1,725 ~3,300 ~4,100 6% faster drilling in 3Q24 vs. FY23 Longest industry lateral in Montney history at 18,110 ft1 Ovintiv has drilled 14 of the 20 longest Montney lateral
Slide 14: Advancing Our Durable Returns Strategy
Builds on strong year-to-date company wide performance Immediately & long-term accretive Drives capital efficiency gain & ROCEŦ boost High-grades portfolio & enhances Montney oil position Leverages industry-leading innovation & execution in Montney oil Expect credit ratings & stable outlook to be re
Slide 15: o3< Ovintiv’
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Slide 16: Appendix
Appendix ¢ %& Ovintiv: 4
Slide 17: Focused & Efficient Portfolio
Focused & Efficient Portfolio Pairing the top two oil basins with stable, low-decline Free Cash FlowŦ Substantial basin scale in each asset Innovations transferred across the assets to drive returns Operational Excellence Drives Efficiencies Proven operational flexibility and margin enhancement Opti
Slide 18: Details on Uinta Basin Exit
Details on Uinta Basin Exit All Cash Proceeds $2.00 $B Funds Significant Portion of Montney Acquisition Production Profile 29 Mbbls/d 3Q24 Oil & Condensate Production Key Dates October 1, 2024 Effective Date 1Q25 Estimated Close
Slide 19: Acquired acreage among the highest oil productivity in the Montney
Acquired acreage among the highest oil productivity in the Montney Proven Montney Oil Well Performance Note: Production data based on wells with 12 months of production brought on production January 2020 or later. Acquisition 46 Wells 14.5 bo/ft -12mo OVV Acreage Acquired Acreage (109k acres) Overpr
Slide 20: Midstream & Marketing Overview
Midstream & Marketing Overview Sufficient Access to Processing & Transportation Capacity Scaled with near-term development plans Option for mid-single-digit oil growth Leverages & Builds on Existing Relationships Ongoing business with midstream providers Plants operated by CSV & Keyera Manageable In
Slide 21: Condy Fundamentals Support Parity to WTI
Condy Fundamentals Support Parity to WTI 1) Canada Energy Regulator, December 2023 (Current Policies case). 2) Montney Condensate: ICE C5 1a + NYMEX Calendar Basis Swap. WTI: WTI Calendar Basis Swap. 3) Unhedged. 2024 YTD is through September 2024. Montney Condensate Competes with WTI ($/bbl)2 Capti
Slide 22: WCSB Supply & Demand Balance
WCSB Supply & Demand Balance (Bcf/d) In-Basin WCSB Demand Exports Out of the WCSB WCSB Production Note: WCSB: Western Canadian Sedimentary Basin. 1) YTD 2024. ~18Bcf/d Natural Gas Production ~10Bcf/d Pipeline Exports ~8Bcf/d Local, In-Basin Demand WCSB Natural Gas Balance by the Numbers1 WCSB Gas Ma
Slide 23: Montney / WCSB Gas Export Infrastructure
Station 2 Malin Sumas Emerson Chicago Dawn Empress Montney / WCSB Gas Export Infrastructure NGTL System TC Energy 1) Unhedged through 2Q24. 2) BBtu/d. Montney firm transport values are calculated from AECO. Northern Border TC Energy Alliance Pembina GTN TC Energy BC (Westcoast) Enbridge Ovintiv’s Mo
Slide 24: WCSB LNG Infrastructure
LNG Canada WCSB LNG Infrastructure Note: ISD: In-service date. FID: Final investment decision. Cedar Ksi Lisims Woodfibre Prince Rupert Gas Transmission Western & Nisga’a LNG Canada Phases 1 (2.0 Bcf/d) & 2 (2.0 Bcf/d) Phase 1: ISD: ~2025 (has taken FID) Phase 2: ISD: ~2030 Owner/Supplier: Shell (40
Slide 25: Canadian Royalty Sensitivity
Note: Royalty calculations assume AECO benchmark prices of approximately 80% of NYMEX. Royalties reflect “Net Effective Royalties to OVV” after incentives. 1) Total BOE Production. Canadian Royalty Sensitivity Royalty Rates Vary Based on Commodity Prices OVV Reports “NRI” volumes after royalties acr
Slide 26: Durable Cash Return Framework
Durable Cash Return Framework Ŧ Non-GAAP measures defined in advisories. For additional information regarding non-GAAP measures see the Company’s website. Note: Future dividends are subject to Board approval. 1) $78 MM base dividend in 4Q24, held flat to 3Q24 for illustrative purposes. 4Q24 Free Cas